There’s a common misconception among potential homeowners that a 20% down payment is required to purchase a home—in fact, about one in three would-be homeowners believe this according to Freddie Mac. This misconception causes many future homeowners to believe that it will be years before they can purchase a home, or that homeownership will always be out of reach. It’s easy to see how misunderstandings about the home buying process can create problems for would-be homebuyers, problems that are just exacerbated by the soaring housing prices across much of the nation. This issue is particularly notable among millennials, as the millennial demographic rate of homeownership is a little over 20% below the national average as reported by The Orange County Register. So what can lenders do to help millennials break out of this trend?
Leverage Social Media with Millennials to Increase Knowledge About Homeownership
Financial education is technically one of the big answers, but it’s an answer that doesn’t help many loan officers and real estate agents get very far—most are ready to educate borrowers, but how do they get to the borrowers? For many mortgage professionals, the answer comes in genuinely leveraging social media, becoming influencers. After all, almost 80% of millennials use social media at least once a day, and many millennials split their time over several social media sites. Why fight to make the crowds come to you when you know where the crowds already are? Platforms like Facebook, YouTube, Instagram, TikTok, and others hold enormous audiences that are already interested to learn more. It can take time and effort to build up a social media following, but the payoff is potentially an engaged following—a community.
Unfortunately, there’s no real “secret sauce” to becoming a successful social media mortgage lending influencer. It takes work to make videos about mortgages and home buying really pop out from the crowd when those videos are competing with some of the latest flashy trends. Often, the most successful influencers are the people who found the right audience at the right time, which means trying to build financial education and awareness through social media becomes an exercise in patience, creativity, and experimentation until your right time comes. At a bare minimum, a good start is to make sure to immerse yourself in your target community so you can speak directly to their needs and interests. Until the clicks and views start rolling in, do your best to be friendly and genuine, and practice explaining difficult financial subjects—such as keeping to a budget, building credit, and the homebuying process—as simply as possible.
Utilizing Trends as a Way to Educate and Grow Homeownership
Part of keeping up with your target community is keeping yourself aware of trends—college debt and loan trends, local and national laws that impact your people, pricing fluctuation, and so forth. In addition, keep in mind the things that your target community cares the most about, and involve yourself in it. For example, many areas of the nation are experiencing movements focused on minority homeownership. Another place to start is to find the minority homeownership initiatives in your area and contact them to see what you can do to help out, then sincerely share that vision on social media. The key there is to be sincere—people will quickly find out if you don’t really care.
And finally, it cannot be stressed enough, the importance of discussing savings, down payments, closing costs, and assistance programs. A lot of would-be homeowner millennials lived through the Great Recession, and that left a sour taste in the mouths of many with regards to the value of a home. Add to that the complicated homebuying process, and the intense financial drain that even small down payments can be for many families, and it’s easy to see how discussing things like down payment assistance and closing cost assistance can be a much-needed ray of hope in the lives of many would-be homeowners. Introducing your borrowers to Chenoa Fund, among other options, will do wonders to motivate and inspire.
The Chenoa Fund down payment assistance program is offered by CBC Mortgage Agency, in addition to the down payment assistance program, also offered are two minority focused initiatives created to promote equitable and sustainable homeownership among underserved communities. Just reach out to our team to learn more about the program, or to receive marketing material that you can use to financially educate your borrowers with, today.
CBC Mortgage Agency™ – NMLS 1186381
For licensing information, go to www.nmlsconsumeraccess.org.
Illinois Residential Mortgage License #MB.6761292. Illinois Department of Financial and Professional Regulation, Division of Banking, 100 West Randolph, 9th Floor, Chicago, IL 60601 – 1-888-473-4858. Georgia Residential Mortgage Licensee, License # 1186381.